Do you sometimes wonder if you are running your business or your business is running you? One of the greatest services our advisors offer at the Small Business Development Center (SBDC) is helping an owner step back and see the pieces of the puzzle that make up the entire organization. To tackle any given part of your organizational needs may best be viewed as a project. Managing a project (or many projects) may give you the perspective you need to solve one issue at a time. (It’s not unlike the joke, “How do you eat an elephant?”)
Project management is simply a process. Break it into several steps. Identify the problem (issue, opportunity, etc.) Design the solution. Implement your plan. And finally, evaluate the results. For now — concentrate on steps 1 and 2 — Identification and Design.
The first step is to analyze the situation. What is the problem, issue or opportunity? Define it as clearly as you can – the more clarity here, the easier the design, implementation and evaluation will be. For example, if you are seeing a decreasing cash balance, you may identify the project as “increasing the number of customers.” If that is the solution then your efforts (project plan) will be focused on getting more people into the business OR it could be about increasing sales to existing customers. But (and a big but), if loss of cash is really about having a miscalculation in your pricing strategy, bringing in more customers will simply break you faster than the current rate. This is the most critical part of project planning. Identify the real issue – not just the symptoms.
Then you can begin to design the solution. This includes the scope of the project, the budget required, the return on investment expected, the activities, the timeline and specifically, who will be responsible for each outcome. This cannot be done in your head. This must be documented, consulted and updated on a regular basis. This is a step that you cannot skip. If you don’t know where you are going – you are not going to know when you get there.
In our example, if your project is to “increase the number of customers,” you need to know by how many? Compared to what? In what given time period? How much will it cost? What does that translate into as a cost per customer? (If it costs you $100 to recruit each new customer and their average sale is $10 – this plan makes no sense.) How will you attract the customers? What tools will you use and when?
This is the beginning of project management. Before you begin, you need a plan. If you jump into the water without knowing how far it is across – you may or not make it, you may or may not expend a lot of energy (and resources) without an achievable goal.
Marcia Bagnall is Director of the Chemeketa Small Business Development Center and instructor of Small Business Management Program. The Small-Business Adviser column is produced by the center and appears each Sunday. Questions can be submitted to SBDC@chemeketa.edu. Visit the SBDC at 626 High Street NE. in downtown Salem or call (503) 399-5088.